Westminster Group Regulatory News (WSG)

Westminster Group Plc:

Trading Update

Westminster Group Plc ('Westminster', the 'Group' or the 'Company'), the AIM listed supplier of managed services and technology based security solutions to governments and government agencies, non-governmental organisations (NGO's) and blue chip commercial organisations worldwide, today updates on its performance in the first half of the year and provides a divisional update on current operations.

Trading in the 6 months to 30 June 2016

As referenced at the AGM statement, the Group expects to report a much improved trading performance compared to the first half of 2015 where it lost c.£0.9m. The Company now expects (based on unaudited management accounts) to report a positive EBITDA at the Interim stage. This has been driven by improved passenger volumes in its airport operations, improved revenue mix, a more favourable USD exchange rate and lower Group costs. Revenues in the first half are expected to be in the region of £2m (2015: £1.9m).

The Group had cash balances of c.£0.7m prior to the receipt of the final placing monies of £0.31m, which were subject to AGM resolutions, on 30 June 2016. As announced previously, the final convertible loan note balance due to Darwin Capital of £0.472m at 30 June 2016 was converted into equity in July 2016.

Managed Services Division

The Company is pleased to report that its Managed Services Division continues to build its presence and considerable potential around the world and, in particular, has made significant progress with the contract negotiations regarding the long term (15 year+) Middle East airport project for which the Company received a Letter of Intent in May 2016. Contract discussions are now largely complete which has resulted in a substantial increase in both the scope and value of the contract and is now significantly greater than the estimated £30m pa previously reported. The Company, together with UK Governmental bodies, is now working with the potential customer and various other governmental organisations in order to finalise the last few issues as a matter of urgency.

In addition to the above, the Company continues to develop its long term managed services opportunities including the six other Memorandum of Understanding (MoU) signed with various governments and airport authorities in different regions of the world previously announced, all of which are still active and three of which were signed in 2016.

Technology Division

As outlined in the AGM Statement in June, the Technology Division has made a positive contribution during the first half of 2016 with higher margins and a lower cost base.

The Company has secured orders and delivered a wide range of products and services around the world and has also made good progress with the potential 20 year Middle East border security project announced in February 2016 for the provision of equipment, training and ongoing maintenance of security screening checkpoints. The Company successfully carried out trials and demonstrations in relation to this project in May 2016 and due to the substantial potential value of this contract and its own specific complexities, is now discussing funding and deployment options with the authorities and banks with UKEF support.

Ferry Update

The Company is pleased to report that its flagship vessel, the Sierra Queen, has now completed the repair works in the local shipyard and is back in the water undergoing engine and equipment tests whilst the 2nd vessel, the Sierra Princess, a 70 seater fast ferry, has arrived in country and has completed all safety checks and is finalising formal in country registration. Both vessels will be commencing sea trials during August and we look forward to commencement of this long awaited service.

In view of the Company's growing long term aviation prospect opportunities, and the momentum with various negotiations underway, the Company has engaged an experienced marine and risk management specialist who is now in country assisting with the operations and deployment of the craft and who will now be providing the management of the ferry service going forward.

New crew including an experienced Captain and Chief Engineer have also been recruited and deployed to country ready for operations.

Strategic Review

The Company has previously announced it is undertaking a wide ranging strategic review of operations to ensure the business is well positioned to maximise opportunities going forward and successfully take the business to the next level. The review, which is on-going, is looking at Board and management structures as well as the Company's operations, financing and advisory structure, particularly in view of the significant growth potential the Company now faces.

At the AGM on 30 June, the Company announced various Board changes and further changes will be made in the coming months to strengthen our management and broaden our range of experience and expertise.

New Websites

The Group has been undertaking a major upgrade of its various websites and on-line presence with a view to further improving enquiries and customer experience. So far in 2016 the Company has completed and launched two new websites, www.wi-ltd.com and www.wass-ltd.com, which are both also optimised for tablet and mobile devices. Further Group websites are under development and will be launched in coming months.

Outlook

Whilst there is never any certainty as to timing or final outcome of the various opportunities we are pursuing, we believe the size, number and geographical spread of the various opportunities we are developing provide significant potential for growth. We are encouraged by the momentum of the Managed Services business, which is now our core focus, which together with the long awaited commencement of the ferry services, at last in sight, means we are both positive and excited by our growth prospects in the months and years ahead.

For further information please contact:

Notes:

Westminster Group plc is a specialist security and services group operating worldwide via an extensive international network of agents and offices in over 50 countries.

Westminster's principal activity is the design, supply and ongoing support of advanced technology security solutions, encompassing a wide range of surveillance, detection, tracking and interception technologies and the provision of long term managed services contracts such as the management and running of complete security services and solutions in airports, ports and other such facilities together with the provision of ferry services, manpower, consultancy and training services. The majority of its customer base, by value, comprises governments and government agencies, non-governmental organisations (NGO's) and blue chip commercial organisations. For further information please visit www.wsg-corporate.com